Circle wins final regulatory approval to establish US trust bank, shares rise
Circle wins final regulatory approval to establish US trust bank, shares rise July 10 (Reuters) - Circle CRCL.N said on Friday it has received a final regulatory approval from the U.S. Office of the Comptroller of the Currency to establish a national trust bank, sending the stablecoin giant's shares surging 10% in premarket trading.
Here are some details:
The charter allows Circle to act as custodian for its own reserves and hold crypto assets on behalf of institutional clients.
"OCC approval to establish Circle National Trust marks a defining step in bringing blockchain technology and digital assets into the core of the U.S. financial system," Circle CEO Jeremy Allaire said in a statement.
Circle said the approval places its trust bank under direct federal oversight by the OCC, the primary regulator for lenders and national trust banks.
As regulatory hurdles eased, digital asset firms have expanded into traditional finance, pursuing banking licenses, custody businesses and payment services over the past year.
Circle issues USDC, a dollar-pegged stablecoin. Stablecoins are cryptocurrencies designed to maintain a fixed value, usually through a 1:1 peg to the U.S. dollar, and are widely used to transfer funds between crypto tokens.
USDC has a market value of about $73.2 billion, according to CoinGecko.
Circle shares have fallen 20.5% so far this year, through last close, giving it a market capitalization of about $15.7 billion, according to LSEG data.
(Reporting by Manya Saini in Bengaluru; Editing by Shilpi Majumdar)
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